PACRA Assigns Initial Entity Ratings to Global Marketing Services

Lahore, May 14, 2019 (PPI-OT): Global Marketing Service (GMS) derives revenue from sales of medical equipments and other supplies, which serve as a key ingredient in the health diagnostic sector. GMS has two primary segments of operations: Clinical and Cardiac. Cardiac division is being made an independent partnership, in which the current partners holding directly and indirectly is approx. 80%. There is intense competition in the sector, as evident from falling margin and heightened cost of doing business.

GMS is striving to hold its position. The firm is led by Mr. Zafar, Owner, as assisted by other partners, some of whom are long standing with the firm. The ratings of GMS reflect its adequate business fundamentals. The firm imports all of their inventory, hence exposed to currency fluctuation and pricing risk. GMS is poised to derive benefits from new product-line introduced under cardiac division, though currently in red zone.

This could help GMS to diversify in different segments and reduces the concentration risk. Overall financial profile is characterized by low capital base and formal and non-formal leveraging. Although profitability has been deteriorated, the company has designed a strategy to boost the same. The ratings are dependent on the company’s ability to sustain business volume and margins. In the wake of dwindling profitability, upholding financial discipline is important.